Nilkanth Engineering Ltd. (NILKANTHENGG) - Auditors Report

Company auditors report

NILKANTH ENGINEERING LIMITED
ANNUAL REPORT 2006-2007
AUDITORS' REPORT
TO
THE MEMBERS OF
NILKANTH ENGINEERING LIMITED
We have audited the attached Balance Sheet of Nilkanth Engineering Limited
as at 31st March, 2007 and also the Profit and Loss Account and the Cash
Flow Statement of the Company for the year ended on that date annexed
thereto. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
1. We conducted our audit in accordance with auditing standards generally
accepted in India. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
2. As required by the Companies (Auditor's Report) Order, 2003 (as
amended), issued by the Central Government of India in terms of Section
227(4A) of the Companies Act, 1956 (the Act) and on the basis of such
checks as we considered appropriate, and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order to the extent
applicable to the Company.
3. Further to our comments in the Annexure referred to in paragraph 2
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit.
(b) In our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examination of those books.
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account of the
Company.
(d) In our opinion, the Balance Sheet, the Profit and Loss Account and the
Cash Flow Statement dealt by with this report comply with the accounting
standards to the extent applicable referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956;
(e) Based on the representations made by the Directors of the Company and
taken on record by the Board of Directors and the information and
explanations given to us, we report that none of the Directors is, as on
31st March, 2007, prima-facie disqualified - from being appointed as a
Director in terms of clause (g) of subsection (1) of Section 274 of the
Companies Act, 1956;
(f) In our opinion to the best of our information and according to the
explanations given to us the said accounts subject to Note No.2 in Schedule
10 relating to non-provision for diminution in value of investments by
Rs.58,02,266/- aggregate effect of which has resulted in the profit for the
year being higher by Rs 58,02,666/-, resulting in the loss for the year at
Rs.10,83,302/- as against the reported profit for the year at
Rs.47,19,364/- and aggregate Credit balance in the Profit & Loss A/c
carried to Balance Sheet would be Rs 2,07,666/- as against the reported
credit balance in the Profit & Loss A/c carried to Balance Sheet to
Rs.2,65,278/- read together with other notes thereon. give the information
required by the Companies Act. 1956 in the manner so required and give a
true and fair view in conformity with the accounting principles generally
accepted in India.
i) in the ease of the Balance Sheet, of the state of affairs of the Company
as at 3st March, 2007;
ii) in the case of the Profit and Loss Account, of the Profit for the year
ended on that date; and
iii) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
FOR M. K. S U REKA & CO.,
CHARTERED ACCOUNTANTS.
(M. K. SUREKA)
PROPRIETOR
MEMBERSHIP NO. 10147.
PLACE : MUMBAI
DATED : 3 SEP 2007
ANNEXURE TO THE AUDITOR'S REPORT
Annexure referred in paragraph 2 of Auditor's Report of even date to the
members of Nilkant Engineering Limited on the accounts for the year ended
31st March, 2007.
On the basis of such checks as we considered appropriate and in terms of
the information and explanations given to us. we state that :-
i. (a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed Assets.
(b) As explained to us, all the assets have been physically verified by the
management during the year and no discrepancy has been noticed on such
verification.
(c) The company has not disposed off any substantial part of its Fixed
Assets so as to effect its going concern.
ii. Since there are no Inventories, para 4 (ii) (a), (b) & (c) of the Order
is not applicable.
iii. (A) The company has not granted any loan secured or unsecured to
companies, firms or other parties covered in the register Section 301 of
the Companies Act. 1956. Accordingly para 4(iii) (a) to (d) of the order id
not applicable.
(B) The company has not taken any loans, secured or unsecured, from
companies, Firms or other parties covered in the register maintained under
Section 301 of the Companies Act. 1956. Accordingly, para 4 (iii) (e) to
(g) of the Order is not applicable.
iv. In our opinion and according to the information and explanations given
to us. there are adequate internal control systems commensurate with the
size of the Company and the nature of its business for the purchase of
fixed assets and for the provision of services. Further, on the basis of
our examinations and information and according to the explanations given to
us. we have neither come across nor have been informed of any instances of
major weakness in the aforesaid internal control system.
v. (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in Section 301 of the Act, transactions that need
to be entered into the register maintained under Section 301 have been so
entered.
(b) In our opinion and according to the information and explanations given
to us, since the company lias not entered into any transactions, exceeding
Rs. 5 lakhs, in respect of any party during the financial year that need to
be entered in the register maintained under section 301 of the Companies
Act, 1956, para 4 (v) (b) of the Order is not applicable.
vi. The company has not accepted any deposits from the public within the
purview of the directives issued by the Reserve Bank of India and the
provisions of Section 58A & 58AA or any other relevant provisions of the
Companies Act, 1956 and the Rules framed there under.
vii. The company does not have any formal internal audit system during the
year under review. According to the information and explanations given to
us by the management, the company is yet to set up formal internal audit
system. The company, however, has adequate internal control procedures
commensurate with the size and nature of the business of the company.
viii. The Central Government has not prescribed the maintenance of cost
records under Section 209 (1) (d) of the Companies Act, 1956 for any of the
products of the company.
ix. (a) According to the information and explanation given to us and
according to the books and records -as produced and examined, by us, in our
opinion, the undisputed statutory dues in respect of Provident Fund,
Investor Education & Protection Fund, Employees State Insurance, Income-
tax, Wealth-tax, Service Tax, Sales-tax, Custom duty, Excise duty, Cess and
other material statutory dues, as applicable, have been generally regularly
deposited by the company during the year with the appropriate authorities
and there are no undisputed statutory dues payable for a period of more
than six months from the date they became payable as on 31st March, 2007.
(b) According to the information and explanation given to us, on the basis
of our examination of documents and records, there are no disputed dues in
respect of Income-tax, Wealth-tax, Service Tax, Sales-tax, Custom duty,
Excise duty, Cess and other statutory dues which have not been deposited
with the appropriate authorities as at the last date of the financial year.
x. The company has neither accumulated losses at the end of the financial
year nor it has incurred any cash losses during the financial year ended on
that date or in the immediately preceding financial year.
xi. According to the records of the company examined by us and information
and explanations given to us, since the company has not borrowed from
financial institutions/ banks/ by issue of debentures, para 4 (xi) of the
Order is not applicable to the company.
xii. According to the information and explanation given to us, the Company
has not granted any loans and advances, on the basis of security by way of
pledge of shares, debentures and other securities.
xiii. In our opinion, considering the nature of activities carried on by
the company during the year, the provisions of any special statute,
applicable to Chit Fund/Nidhi/Mutual benefit fund/Societies are not
applicable to the company.
xiv. In our opinion, the company has maintained proper records of
transactions and contracts relating to dealing or trading in shares,
securities, debentures and other investments during the year and timely
entries have been made therein. Further, such securities have been held by
the company in its own name or are in the process of transfer in its name,
except to the extent of exemption granted under Section 49 of the Act.
xv. According to the information and explanations given to us and the
representations made by the Management, since the company has not given any
guarantee for loans taken by others from bank or financial institutions,
para 4(xv) of the Order is not applicable.
xvi. In our opinion, on the basis of information and explanations given to
us, since there are no term loans obtained by the company during the year,
para 4 (xvi) of the Order is not applicable.
xvii. In our opinion, on the basis of information and explanations given to
us, since there are no short-term funds raised by the company during the
year, para 4 (xvii) of the Order is not applicable to the Company.
xviii. In our opinion, on the basis of information and explanations given
to us, since the company has not made any preferential allotment of shares
to parties and companies, covered in the register maintained under Section
301 of the Companies Act, 1956 during the year, para 4 (xviii) of the Order
is not applicable.
xix. In our opinion, on the basis of information and explanations given to
us, since the company has not issued any debenture during the year, para
4(xix) of the Order is not applicable.
xx. In our opinion, on the basis of information and explanations given to
us, since the company has not raised any money by public issue during the
year, para 4(xx) of the Order is not applicable.
xxi. During the course of our examination of the books of account carried
out in accordance with the generally accepted auditing practices in India
and according to the information and explanations given to us, we have
neither come across any instance of fraud on or by the company, noticed or
reported during the year nor have been informed of any such case by the
management.
FOR M. K. SUREKA & CO.,
CHARTERED ACCOUNTANTS.
(M. K. SUREKA)
PROPRIETOR
MEMBERSHIP NO. 10147
PLACE: MUMBAI
DATED: 3 SEP., 2007.